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02.09.12

States Reach $26 Billion Mortgage Deal

David J. Phillip / AP Photo

The five largest banks in the U.S. agreed to a $26 billion settlement for the roles they played in the mortgage meltdown. As many as two million Americans could reap financial benefits from the settlement, the largest of its kind in history and the biggest civil-action suit ever against the housing industry. All 50 state attorneys general started working on the deal in late 2010 amid outrage over the corrupt mortgages. Though billions are laid out in the agreement, the money will likely help only a relatively small portion of borrowers facing foreclosure, depending on how effectively Washington manages the deal. The deal also does not rule out criminal prosecution for the banks.